Committee passes bill forcing PBMs to choose between being a pharmacy benefit manager or owning pharmacies, setting up state‑level fight over PBMs

House Bill 1150, sponsored by Representative Jeremiah Moore, passed the House Insurance & Commerce Committee following a lengthy hearing with competing testimony from independent pharmacists, pharmacy chains, specialty pharmacies, employers and PBM representatives.

Moore said the bill would remove a conflict of interest when PBMs both set reimbursement terms and operate pharmacies. "The FTC reports over the past year have been quite damning in nature…they reimburse independent pharmacies $97 while reimbursing their own pharmacies $19,200 for the exact same drug," Moore told the committee, quoting investigative findings used by proponents.

Supporters, including the Arkansas Pharmacists Association, local independent pharmacists and some hospitals, said the bill will restore competition and local access. John Vincent, CEO of the Arkansas Pharmacists Association, told lawmakers the measure would require PBM‑owned pharmacies either to be run as pharmacies or to operate solely as PBMs, or to divest their retail operations. Vincent and proponent witnesses said up to roughly 36 PBM‑affiliated brick‑and‑mortar locations could be affected under current licensing records but emphasized that approximately 700 other pharmacies would remain in operation across the state.

Backers argued the measure would protect local pharmacies from what they described as anti‑competitive steering and differential reimbursement models that favor PBM‑owned outlets. Brittany Sanders, a co‑owner of a local independent pharmacy and president of the Arkansas Pharmacists Association, said the current market has made it difficult for independents to survive and urged the committee to act.

Opponents mounted a broad coalition in opposition. Employers and self‑funded plan representatives told the committee the bill would reduce low‑cost mail‑order options they rely on to keep plan costs down and could increase out‑of‑pocket costs for patients. Adam Head, CEO of Carta (a nonprofit cancer provider and pharmacy operator), testified that specialty and infusion care relies on integrated pharmacy services that coordinate with clinical providers and that disrupting those arrangements could complicate care.

Specialty pharmacy providers such as Accredo and national retailers including CVS testified that the bill could disrupt access to specialty and limited‑distribution drugs, increase logistical burdens on patients who receive home infusion and introduce medication adherence problems when patients are forced to change pharmacies. Sharon Faust of Navitus, a PBM serving Arkansas employers, told the committee that peer‑reviewed evidence shows medication adherence can drop when patients switch pharmacies; she cited a 15% adherence decrease in literature highlighted in testimony.

Business groups warned of unintended consequences and said existing state regulatory tools (the Insurance Department audits, anti‑steering rules and pharmacy statutes) can be used to address bad actors. Randy Zook, representing employer interests, said the bill would amount to government intervention in private business structures and warned it could raise costs by reducing competition.

Representative Moore said the bill is targeted and that Arkansas already has statutes and board processes to implement the change; he said the Attorney General’s office reviewed the measure and expressed confidence it could be defended if challenged. Committee discussion also addressed administrative implementation: the bill gives the State Board of Pharmacy authority to develop written policy and limited‑use permits to avoid short‑term access gaps.

John Vincent said the board would be required by an amendment to publish an implementation policy and that hospitals and other providers had worked on amendments intended to preserve continuity of care for patients. Vincent told the committee that the board’s current permit and exception processes could be used to maintain access for drugs that are scarce or limited‑distribution.

Despite the opposition, members voted to pass the bill out of committee by voice vote. Sponsors and backers framed the passage as a step to protect local pharmacies and patients; opponents said they will continue to press concerns about specialty access, mail order impact and economic disruption as the bill moves forward in the Legislature.